The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1887-10-19

pons of the bonds issued under it should be
receivable at and after maturity for all taxes
and dues to the State. But the State soon
found that the plan of receiving taxes in
coupons did not work satisfactorily, and the
next year an act was passed prohibiting col
lectors of taxes from receiving anything but
money in payment of taxes. That is, the
State that had agreed with the people who
lent it money on its bonds that coupons on
these bonds should be good for taxes, calmly
declared year later, after it had got the
money and the lenders had got their bonds,
that the coupons should not be good for
taxes, previous agreement to the contrary
Notwithstanding. The bondholders at once
took their case to the State Court of Appeals,
and their demand that the State receive the
coupons for taxes as it had agreed to when
they bought the bonds, was sustained. The
case was carried to the Supreme Court of the
United States, which also sustained the de-
eislon in favor Of the bondholders in an opin-
ion given in 1880. This marks the first stage
of the controversy. Virginia had attempted
directly to repudate part of a contract
upon which she had solemnly entered. The
State Court of Appeals and the United
States Supreme Court had denied her right
to do so.
The second stage, of which the pro-
ceedings now going on are part, marks the
effort of the State of Virginia to accomplish
indirectly what it failed to do directly. In
1882 its Legislature passed an act providing
that when coupons were rendered they
should be taken, but that the taxes should
also be paid in money pending trial to de-
eide whether the coupons were genuine. If
the coupons were found to be genuine the
money was to be refunded. The object of
this act was, of course, to make the use of
coupons in payment of taxes so tedious that
the bondholders would prefer to pay the
money and have it done with. But the SUI
preme Court of the United States sustained
this act, Justice Field dissenting. Later,
pons were rendered and other payments re-
fused the tax officers could not levy upon the
property Of the taxpayer for the satisfaction
of the claims of the State. Then the Court
went still farther and decided that suits
could be brought against the officers of the
State in the Federal courts, and injunctions
could be issued to prevent those officers from
refusing coupons and leyying upon property.
In this last decision, however, the court
was divided five to four, there being involved
grave constitutional question as to the jul
dicial power of the United States in suits
against one of the States. Thwarted in their
efforts to disewn the coupons by these opin-
ions of the Court the Legislature of Virginia
proceeded in its efforts to break its contract
with the bondholders by indirect means. In
1886 it enacted that in suits to test the genu-
ineness of coupons under the act of 1882 no
verdict in favor of the bondholders should be
recorded unless the bonds from which the
coupons were cut were produced in court and
that no expert testimony should be admitted
He would be a stubborn bondholder it was
thought, who would not rather pay his taxes
in cash than undertake the well nigh impos-
sible task of proving the coupons But even
this law was not enough, and last May an
other act, called the Coupon Crusher' was
passed, directing the Attorney General and
County Attorneys to begin suits against the
tax debtors and the only issues to be permit
ted were the fact of the tender of the cou-
pons and the commences of the same. If
they should be found to be not genuine they
were to be retained by the State Treasurer
thus In reality confiscating them. This
marks the elimination of Virginia's indirect
attempt by legislation to make void her
agreement to receive coupons for taxes.
Here the decision OF the United States Su-
preme Court that a United States Court
could enjoin the State officers of Virginia to
desist from leyying upon the property of a
taxpayer comes up for practical applica-
ton. United States Circuit Judge Bond has
issued an injunction to restrain the Attorney
General of Virginia and the County Attor-
neys from bringing suits under the Virginia
act of last May. They have not desisted,
and have been imprisoned for contempt
Chief Justice Waite's decision yesterday de-
termined whether the State officers should or
should not be admitted to bail until it can be
decided whether a United States Court can
coerce the officers of State who are acting
under State laws. This is constitutional
question of great Importance.